E-Commerce and the Neutral Net

Google's recent move to forsake Net Neutrality — the premise that all content on the Web should be distributed even-handedly — threatens to have serious consequences for electrical distributors' websites, especially if other Internet titans follow suit.

Slower-loading Web sites and bidding wars for preferential treatment from Internet service providers (ISPs) could all become a sobering, new reality for those in the electrical wholesaling industry, as the Internet's current democratization gives way to enhanced service for those with the deepest pockets.

”This is completely unfair and would hurt smaller content providers who didn't have the resources to pay the fees,” says John M. Simpson, director, Inside Google Project, Consumer Watchdog: “Content would be dominated by large mega corporations, much like cable television is today.”

Eric Wylie, owner of Wylie Creative Communications, a tech communications firm that has done work in the electrical supply industry, agrees: “While I am supportive of a free market, competition and entrepreneurial thinking, this appears to be an instance where those with the money and toys are attempting to make new rules to favor their businesses and usurp standards that were designed to ensure equality for everyone involved in this space.”

Jonathan Zittrain, a law professor at Harvard and co-founder of the Berkman Center for Internet and Society at Harvard Law School, sees the threat similarly: “Verizon could say to Google: regardless of what you pay your own ISP to get your bits launched on the Internet, pay us more, and we'll make sure your YouTube videos get to our subscribers all the more quickly as they come in for a landing.

“Google might well be able to pay,” Zittrain adds. “And then leave poorer content providers behind,” — including the legions of electrical wholesaling websites that play many leagues below Google in terms of working capital.

Google has countered that its move to abandon Net Neutrality is a necessary “compromise” it needed to make with its ISP partner Verizon, which has long loathed Net Neutrality, and which also promotes the Google Android operating system on its Verizon phones.

Essentially, ISPs like Verizon have long complained that a concept like Net Neutrality makes it impossible for them to charge higher rates for people and companies that consume more bandwidth than others.

Someone's grandmother for example, who sends just a few emails to her grandkids every week, shouldn't have to pay the same rate as a movie fanatic next door, who is downloading bandwidth-hogging films to a hard drive the size of a treasure-chest.

Some Web designers, like Michael Hays, owner of TruckingWebDesign.com, agree. “Google and Verizon are both for-profit companies, and have invested in research and development in order to have a competitive edge,” Hays says. “If this results in a tiered payment structure for how fast the information is being downloaded, at least the end user is left with a choice. If the FCC steps in to regulate wireless internet speed, availability, and offerings, there probably will be few choices if any, and therefore less competition, less business and fewer jobs.”

But critics of the new Google/Verizon Alliance say the companies' joint proposal goes well beyond evening the score in terms of charging for bandwidth use. Instead, over time, the move will essentially transform a few, giant companies into landlords of the Internet.

“The Google-Verizon deal contains no protections for wireless access, which accounts for nearly one-third of all Internet connections, giving Verizon and other ISPs the green light to block or degrade content on their wireless networks,” says S. Derek Turner, a research director at Free Press. “In addition, it would allow Internet service providers to discriminate online by offering ‘private' Internet services alongside those on the ‘public' Internet.”

The threat is especially urgent, Google critics add, since there is currently no governmental body that has the authority to prevent what Google/Verizon have called a “proposal” for a new Web from morphing into an “every day business practice.”

The reason? While the Federal Communications Commission seems the logical choice to regulate the Web when it comes to Net Neutrality, a U.S. Court of Appeals in the District of Columbia decided in April that the agency has no legal authority to impose Net Neutrality regulations.

In a phrase, there are all sorts of people with all sorts of opinions about Net Neutrality, but in terms of regulations right now, no one's really driving the car.

Near future, fierce public backlash against a Web devoid of Net Neutrality — which would divide itself into a collection of upscale, gated virtual communities, alongside blighted digital ghettos — appears to be keeping the wolf at bay, Google critics say.

But long term, critics fear that without government intervention, your electrical wholesaling site could be negatively impacted in the following ways:

Slower videos. Some content-providers, such as video-sharing sites, would be able to pay an added fee to ensure their videos are downloaded faster on the wireless Internet than other videos. In practice, this could mean videos from YouTube (a Google-owned company), for example, would download quicker than say the promotional videos on your electrical wholesaling site.

“This would clearly be possible on the wireless Internet under the Google-Verizon proposal,” says Consumer Watchdog's Simpson. “I think, indeed, that the deal would allow for some paid premium services on the wired Internet as well.”

Higher internet fees. Some businesses might have the opportunity to pay a premium fee on the wireless Internet to ensure their Web sites download faster than the Web sites of other, non-fee-paying businesses.

”This is unfair and would limit competition and consumer choice,” Simpson says. “Consider the implications of Google being able to pay for its search service to download faster than Bing's search service.”

Bidding wars for download speed. Competitors in the same industry, including electrical wholesaling, could ultimately be forced into a bidding war for the fastest Web site download times on the wireless Internet. This bidding war would mirror the war that currently rages every day among businesses that bid on Google keywords that lead searchers to their sponsored links.

“This is unfair in that it would give preference to a few of the wealthiest, largest companies,” Simpson says. “The Internet was supposed to provide open access to all comers, treating all data the same.”

Left outside looking in. Some electrical wholesaling Web sites could simply be closed out of the fast lane on the wireless Internet, due to private deals struck between mega-ISP's and their preferred customers. “Verizon could offer only Google's search,” Simpson says. “The Internet was meant to be open to all equally. This violates that basic principle and is clearly unfair.”

John W. Ralston, Jr., CEO of Sitecats Web development, which has done work for the electrical supply industry, agrees: “If NBC or Murdoch buys Comcast (an ISP), or something similar, this could happen. These are very large companies and there should be congressional discussion now to prevent such unfair practices from occurring. People are paying for internet freedom, and extra for freedom to choose extra services they decide to buy. Taking away the freedom to get to our favorite sites due to a conglomeration would probably not sit well with the public.”

New fees for new services. Some electrical wholesaling businesses could be forced to pay an added fee on the wireless Internet if they wanted to add yet-to-be-innovated new services. Fifteen years ago, for example, adding easily downloadable video on a website was virtually unimaginable. Now, a ten-year-old kid with a cellphone can do it in between lollipop licks. If the Google/Verizon proposal was in effect 15 years ago, we could all be paying extra for the privilege of offering video on our websites today.

”This is one of the most damaging aspects of the Google-Verizon deal,” Simpson says. “New charges could be added for heretofore unimagined services. Clearly this unfairly thwarts innovation, or at the least limits ‘innovation' only to those who can afford to pay. This is tremendously damaging to new start-up enterprises, the real incubators of true innovation.

Fewer hits on your website. Some electrical wholesaling Web sites on the wireless Internet could begin to see fewer hits, as ever-rising Internet connection fees for consumers and businesses — like the ever-rising fees we now all pay for cable - could begin limiting the number of people freely surfing the Web.

”This is exactly the danger,” ConsumerWatchdog's Simpson says.

Even so, given all Simpson's warnings, TruckingWebDesign's Hays is unmoved. “The instant gratification/instant information age is here, and the bottom line is: Which camel is going to come into my tent — big government, or big business?” he says. “With big business, comes choices. With regulation, I may get choices, but the choices will probably read like Medicare Parts A, B, C and D, and some pages will be blacked out altogether.”

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